By Ray Birch
TEXAS CITY, Texas—With increasing regulator scrutiny of vendor management and increased cyber security concerns related to potential attacks from Russia, one credit union says consolidating a number of its vendors with one company has helped it save time, money—and mounting headaches.
“I’d say we have about 100 different vendors we work with right now, and we have to do the due diligence and risk assessment with all of them,” explained Jeremy Silva, CFO at AMOCO Federal Credit Union here. “It's getting really hard to manage and we have had to consolidate to keep this number from getting even bigger and bringing with that all sorts of complexities and compliance issues—as well as stealing away staff time.”
To address the situation, $1.2-billion AMOCO FCU has been partnering with SWBC, using the company’s Total Solution offering, which seeks to allow clients to streamline and simplify vendor management and move to a more unified vendor platform.
Total Solution covers risk (CPI and collections), transaction enablement and income generation solutions, omnichannel communication capabilities and industry-specific technologies.
Silva said the move gives AMOCO FCU one partner responsible for each product or platform they use with SWBC. It also means vetting only one company for security and compliance.
“And, your employees don’t need to toggle between different vendor platforms on a daily basis. The fewer vendors, the less room for error,” said Lisa Pinto, vice president of public relations and corporate communications for SWBC. “We listened to our clients and wanted to help them save time and increase efficiency when it comes to income generation, payments, and risk management. SWBC’s Total Solution uses our integrated AutoPilot Portal to manage multiple products in one place with one vendor. And, we are able to integrate with all leading core platforms.”
How it Began
Silva said AMOCO FCU started with SWBC Total Solution with cash-management services.
“That was several years ago, and we've added solutions since that point,” he said. “We added collections. We've added some tax prepayment reminders and CPI a couple years ago. More recently, we've added gap insurance and extended warranty coverages for members. So, pulling all these things together so they're tightly integrated.”
Not surprisingly, Silva said as the credit union grows, vendor management has become more difficult.
“We wanted to consolidate things under specific vendors and partners that we are confident in and have done a good job for us,” said Silva. “We have had to go with more vendors in recent years, and this was becoming an issue because there's so many solutions now that credit unions have to adopt—maybe it's adding on to mortgage lending capabilities…”
Silva emphasized mortgage lending is an area that is requiring more partnerships today.
“Real estate is an area where we've been heavily focused on the last few years,” said Silva. “That's an area where we were looking for additional vendors.”
500 Questions
All of those demands are taking place at the same time one category by itself has become overwhelming: cybersecurity.
“Demands here have really increased as we add more technology,” Silva explained. “I don't know if you’ve ever seen risk assessment questionnaires that we have to go through for critical vendors that handle member data, but they’re at least a 400- to 500-question document, and that's something we have to do on an annual basis—making sure that our partners have the appropriate processes, procedures and technologies in place to protect our members’ data.”
The savings with vendor consolidation are in dollars and in employee time, emphasized Silva.
“I would say the key benefit is just the integration of all the services together, making compliance and management easier,” said Silva.
Silva said those savings are not the only reason for the move to consolidate with SWBC, as the decision has helped boost collections efficiency.
“For example, now we can make collections calls and members can actually make their payments in this same process,” he said.
Better Understanding
AMOCO FCU COO Ashley Carner said another advantage is having more solutions with one vendor allows the credit union and vendor to work better together.
“With our relationship with SWBC, it seems to be the more products we have with them the more they get to know us,” said Carner. “We can make better, faster decisions and SWBC has been able to offer better solutions since they know us well.”